Is a Chem Dry franchisee allowed to use cleaning solutions from sources other than Chem Dry or its approved suppliers?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
to impose on FRANCHISEE a fine of $5,000 for each occurrence or to terminate this Agreement. FRANCHISEE will pay any such fine when invoiced.
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- FRANCHISEE is required to maintain a business telephone in accordance with the System Standards in the Manual.
B. AUTHORIZED PRODUCTS AND APPROVED SERVICES
The reputation and goodwill of CDI and the Franchise System is based upon and can be maintained and enhanced only by furnishing consistent high quality carpet and upholstery/drapery cleaning, spot removal, applying anti-allergen and deodorizer, and protecting services and other related products and services. FRANCHISEE agrees, therefore, to only offer such cleaning, spot removal and protecting products and other services, and Approved Services that CDI shall authorize from time to time for the BUSINESS. FRANCHISEE agrees not to sell, rent or lease the Customer List(s) or customer contracts, or otherwise use the Customer List(s) for any purpose other than in connection with the operation of the BUSINESS. FRANCHISEE agrees not to, without the prior written approval by CDI, offer or sell any type of service or offer, sell or use any product that is not authorized by CDI for the CHEM-DRY Business. FRANCHISEE will not resell any type of cleaning solutions without the express written approval of CDI. FRANCHISEE
further agrees that the equipment used in CHEM-DRY Businesses shall not be used for any purpose other than the operation of the BUSINESS in compliance with this Agreement and in the manner in which it was intended and according to operating procedures as outlined in the Manual.
C. COMPLIANCE WITH LAWS AND GOOD BUSINESS PRACTICES
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- FRANCHISEE shall secure and maintain in force in its name all required licenses, permits and certificates relating to the operation of the BUSINESS. FRANCHISEE shall operate the BUSINESS in full compliance with all applicable laws, ordinances and regulations, including without limitation all government regulations relating to environmental protection, occupational hazards and health, worker's compensation insurance, unemployment insurance, terrorist activities, and withholding and payment of federal and state income taxes, social security taxes and sales and service taxes.
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- The BUSINESS shall, in all dealings with customers, suppliers, CDI and the public, adhere to the highest standards of honesty, integrity, fair dealing and ethical conduct, including but not limited to, performing Approved Services pursuant to the BUSINESS within a reasonable amount of time from a customer's request. FRANCHISEE shall address all customer complaints in a timely manner and work diligently to resolve issues concerning the services provided pursuant to this Agreement. In the event CDI becomes involved in the resolution of a customer complaint, FRANCHISEE agrees to cooperate fully with CDI and its representatives in the investigation of the complaint. CDI will determine whether to offer to the customer as a result of CDI's investigation. FRANCHISEE will pay the cost of resolution, including any discounts or refunds to the customer CDI may deem, in its sole discretion, as necessary under the circumstances. CDI's decision is are binding upon FRANCHISEE.
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- FRANCHISEE agrees to refrain from any business or advertising practice which may be injurious to the business of CDI and the goodwill associated with the Marks and other CHEM-DRY Businesses. FRANCHISEE shall notify CDI in writing within five (5) days of the commencement of any action, suit or proceeding, and of the issuance of any order, writ, summons, injunction, award or decree in any court, agency or other governmental instrumentality, which may adversely affect FRANCHISEE'S operation or financial condition or that of the BUSINESS and of any notice of violation of any law, ordinance, or regulation relating to the BUSINESS.
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- FRANCHISEE acknowledges and agrees that to comply with all federal, state, and other data security and privacy legislation applicable to the BUSINESS and its customers, and any Payment Card Industry Data Security Standards applicable to credit card data or related information.
**D.
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, franchisees are generally required to purchase cleaning solutions from Chem Dry or its approved suppliers. Chem Dry's reputation depends on consistent, high-quality cleaning services, so franchisees must only offer cleaning, spot removal, and protecting products and services that Chem Dry authorizes for the business.
A Chem Dry franchisee agrees not to offer or sell any type of service or product not authorized by Chem Dry without prior written approval. They also cannot resell any cleaning solutions without express written approval from Chem Dry. The equipment used in Chem Dry businesses must only be used for the business's operation, following the outlined operating procedures.
Chem Dry franchisees must use only approved operating assets, equipment, cleaning solutions, supplies, promotional materials, and business services. Cleaning solutions must be purchased exclusively from Chem Dry, its affiliates, or designated suppliers at the current list price, with payment due within 30 days of the invoice date. There is a minimum annual purchase amount of $3,244.50 for cleaning solutions, which may increase annually based on the Consumer Price Index.
If a Chem Dry franchisee uses any non-approved cleaning process or equipment, offers non-approved services, or possesses cleaning solutions not obtained from Chem Dry, the franchisee may be fined $5,000 per occurrence or face termination of the Franchise Agreement. This strict control over sourcing helps Chem Dry maintain quality and consistency across all franchise locations.